LDK Solar Slumping Nearly 13% As Slack Demand Weighs On Q4

By Teresa Rivas

Shares of LDK Solar (LDK) were falling 12.8% in morning trading after the company’s fiscal fourth quarter fell short of investors’ expectations.

Before the bell, LDK reported a loss of $588.7 million, or $4.63 per share, down sharply from a year-earlier profit of $1.09 per share. Analysts were expecting a loss of 85 cents a share. Revenue tumbled more than 50% to $420.2 million, also missing the consensus of $431.59 million.

Gross margin shrank dramatically to negative 65.5% from positive 27.3% a year ago, as weak demand and falling average selling prices affected the results. Nor does LDK see the situation improving in the near future. CEO Xiaofeng Peng said, “In 2012, we expect that excess capacity and further policy uncertainties in Europe and the U.S. will result in continued intense competition within the solar industry. As such, we remain focused on improving our cost structure by driving down production costs and closely managing our operating expenses.”

LDK issued guidance for revenue between $190 million and $230 million for the current fiscal first quarter, again missing the $397 million target analysts were expecting. However, it continues to expect revenue of $2 billion to $2.7 billion for the year, ahead of the consensus $2.19 billion.

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APRIL 30, 2012 9:42 A.M.

gebby wrote:

I notice in general commentary that the conservatives in government and their followers are gleeful as solar energy companies lose money and the future of clean energy is threatened by these losses as these companies are forced to adjust to the sudden change in policies as conservative governments are elected. The conservative governments are working hard for the legacy energy companies. Solar will ultimately surpass fossil fuels.

APRIL 30, 2012 5:40 P.M.

Michaeljohnson wrote:

I notice in general commentary that liberals choose to waste other people's money on projects that can't be sustained by the free markets they must exists in. The only way solar power overtakes oil and coal.. Is if SOLAR is cheaper.. There is no way it will be cheaper when.. A,) Obama and his cronies slap tarrifs on imports of cheaper products while they artificially support union run solar manufacturers in the USA..
I am a solar supporter.. and i'm gleeful when I see companies blow up that have been artificially supported by a fake market where government steals from someone who actually worked to provide and gives it to someone else who retires a millionaire for working a scam job for just a few years.. Government just about fails at every single market it tries to interfere in .....

APRIL 30, 2012 6:35 P.M.

gebby wrote:

michael johnson, Your comments are inconsistent. Government does not steal money. Governments set policy. They prioritize how to spend tax revenues. 50 countries have FIT because of AGW. This is the priority but new conservative governments are busy as you would say. Stealing the tax dollars to give to fossil fuel, legacy energy companies, undermining the policy objectives set out by the world cooperating to combat AGW and sustaining life on this planet. Those that buy into "free markets" are the same people that buy Coca Cola because advertising has convinced them it is the real thing. Having a broad vision requires critical thinking and understanding.

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